If Jo Ann Has $4,000 in Liquid Assets and $1,000

question 101

Multiple Choice

If Jo Ann has $4,000 in liquid assets and $1,000 in current liabilities, her liquidity ratio is

• A) 0.25.
• B) 4.0.
• C) 1,000.
• D) 4,000.

Analyze and apply internal control principles to cash disbursement and receipt processes.

Understand the prevalence of fraud and the role of internal control in fraud prevention.

Compare and contrast the definitions and treatments of cash and cash equivalents under IFRS and GAAP.

Prepare and adjust entries in bank reconciliation and understand the effects of reconciling items on the adjusted cash balance.

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Definitions:

Increasing Costs

This refers to a situation where the costs of production increase as the output level increases, often seen in industries with limited resources.

Production Efficiencies

Occurs when a firm or economy can no longer produce additional amounts of a good without lowering the production level of another product.

Trade Surplus

A situation where a country's exports exceed its imports during a specific period, reflecting a positive balance of trade.